The forging of a trade agreement between Canada and the European Union, under negotiation since mid-2009, could help alleviate a growing labour crunch, proponents said Wednesday.

The Canada-EU Trade Agreement (CETA) would not only eliminate many tariffs over a seven-year period, it would also enable trained professionals and tradespeople to cross borders and work, said Maurizio Cellini, head of the economic and trade section for the European Union.

“The CETA negotiations are aimed not only at border measures but more generally at reducing the barriers beyond the borders that unnecessarily limit the ability of nationals of one party to seek opportunities in the other party’s markets,” Cellini told an audience at the Global Petroleum Show in Calgary. “And this is particularly true for sectors like oil which, in terms of positions of trade, is already free and not hampered by tariffs, quotas and the like.”

Canada ranks 11th on the list of major trade partners with the EU, after Brazil, Cellini noted. In contrast, the 27-member union is the second largest export market for Canada, representing 10.4 per cent of Canada’s external trade, after the United States and ahead of China’s 7.4 per cent.

On a more local level, between three per cent and four per cent of Alberta exports are directed to the EU, including coal, wheat and canola.

Imports from the EU are more technology-based, said Daryl Hanak, executive director of trade policy for the province. Hanak noted the province was concerned about the proposed fuel quality directive being studied by the EU, which targets Canadian oilsands as being among the most carbon-intense fuels in global markets.

“We feel that a fuel quality directive that treats all crude equally will be prudent not only for Alberta’s energy sector, but also for the many European business who have invested in our oilsands,” Hanak said.

Alberta’s oilpatch has argued the proposed fuel directive was unfair and discriminatory to Canada as it did not take into account other factors affecting crude oil production in other countries.

Cellini said it was “really absurd” to say the EU was purposely discriminating against Canada through the directive, saying it was one element of a general green-house gas strategy.

He noted the directive was not linked to the trade agreement, adding a new impact assessment was expected by the end of 2012, with a new proposal being announced in 2013.

While Canada has virtually no oil trade with the EU, signing on to a trade agreement with the 500-million person strong market would broaden the country’s trade horizons, said Gary Houston, with Total E&P Canada.

The U.S. has been a good market for Canada but the industry needs more than one client, he said.

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A History of Economic Cooperation

Canada and the EU have a long history of economic cooperation. Composed of 27 Member States with a total population of over 500 million and a GDP of nearly $16.8 trillion in 2010, the EU is the world’s largest single common market, foreign investor and trader. As an integrated block, the EU represents Canada's second largest trading partner in goods and services. In 2010, Canadian goods and services exports to the EU totalled $49.1 billion, and imports from the EU amounted to $55.2 billion.